Top Story

Institutional allocations to alternative investments are expected to rise sharply over the next few years, according to the latest Global Institutional Investor Survey by Fidelity. In addition, investors are expected to boost exposures to domestic fixed income, cash and liquid alternatives.

A range of strategies is emerging among European direct lending funds as the booming sector matures and as competition for profitable leveraged finance business heats up, while collaboration between traditional and non-traditional credit providers is increasing.

In Depth

When does a fund sponsor need to use a registered broker/dealer when raising capital? At first blush, the rules governing registration requirements and the exemptions available to private funds seem clear, and the use of a placement agent can often solve any potential issues. However, as discussed by Cole Schotz partner Chris Kula, securities laws have not caught up with the realities and developments in the private fund space. When added to a renewed focus on private fund compliance by regulators, the question of whether to raise capital through a registered B/D remains highly relevant for any alternative investment manager looking to grow assets.

Guest Contributor

Conventional wisdom holds that due diligence examines quantitative as well as qualitative characteristics of a manager, but the easiest information to get about a fund – performance numbers, statistics, pitchbooks, etc. – can also be the least likely to truly explain a manager’s style, how he or she thinks, the firm’s operational personality, etc. As pointed out by Bruce Frumerman of Frumerman & Nemeth in this contributed article, such “soft” information has become increasingly important in the minds of institutional investors, and alternative asset managers that don’t pay attention to effectively communicating these attributes may find themselves out of the running for an allocation.

Lifestyle

U.S. President-elect Donald Trump attended a "Villains and Heroes" costume party at the Long Island home of Renaissance's Technologies co-CEO and major campaign donor Robert Mercer over the weekend, but he declined to adhere to the party's theme.

FINtech

The rapid pace of technological innovation in the alternative investment industry has steadily raised the profile of operational alpha, or the premise that technology allows a fund’s capital to be allocated much more efficiently and cheaply, in turn freeing up resources for alpha-generating activities like research, personnel, data analytics and marketing. The team at Alphaserve Technologies focuses on unlocking this value through institutional-class IT expertise spanning everything from cloud services to enterprise-wide IT solutions that can scale to size as necessary.

From The Archives

For prudent investors, the ubiquitous tear sheet is ground zero for any further investigation of a fund; the more impressive they are, the more questions they raise. In our inaugural Trade Secrets column on due diligence, we look at a Brazilian direct lending fund whose tear sheet promotes performance that would make any investor sit up straight, including 100% positive months, a Sharpe ratio of 16.7, no drawdowns, and weekly liquidity. But is all as it seems?

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Since the inception of Modern Trader, a core editorial theme has centered on the wisdom and power of crowds. Editorial emphasis has focused on companies and projects engaged in the collection and analysis of information.